Feds hurried to spend $50M social-finance cash, documents show

At the same time, federal officials continue to work on the design of the $755 million social-finance fund

Internal government documents show that federal officials moved quickly before the fall election campaign to dole out $50 million aimed at transforming the delivery of social services.

The idea was to push money to national groups with a track record of success, and then raise awareness about the money itself with smaller groups the transformation effort is supposed to help.

A March briefing note to the minister in charge of the file said that officials would “strategically select projects” to fund “given the tight timelines” for announcements to start in June.

The approach would be faster than launching an open call for proposals, officials at Employment and Social Development Canada wrote in the document obtained by The Canadian Press through the Access to Information Act.

The money is part of a larger pot of spending that the Liberals want to give out in the coming years to social-services groups to help them partner with the private sector.

The idea is to give non-profits new sources of revenues, offer investors a way to make money while supporting social services, and possibly save federal cash in the long-run.

The Liberals have put some $800 million behind the social-finance initiative that has been the subject of behind-the-scenes debate since first announced just over a year ago.

The concept has cross-party support and groups working in the nascent sector are looking forward to seeing the final details of how the bulk of the money will be distributed, said Stephen Huddart, president and CEO of the McConnell Foundation.

The organizations using the $50 million to expand capacity — to prepare actual service providers to apply for and use the rest of the money — met in June and are scheduled to meet again in the coming weeks.

At the same time, federal officials continue to work on the design of the $755 million social-finance fund.

The idea is that payments from government would flow if a project — finding housing for people for whom current programs haven’t worked, for instance, or helping people kick drug addictions — has been shown successful through detailed data. But such a project would have to be funded in the beginning by private backers who take on the risk of failure.

The government has been told in meetings to seek three times the seed capital from private and philanthropic sources, which would amount to almost $2.3 billion on top of what’s coming from federal coffers.

The documents obtained by The Canadian Press also show the government was told to look for a return to its main social finance fund to make it sustainable, allowing the initial $755 million to be recycled over and over for new projects.

“While we support the idea that the government’s capital should be returned, I don’t think anyone would say that it’s more important to generate a financial return than it is to generate social impact, or environmental impact or to increase community capacity to solve and address complex problems,” Huddart said.

The documents don’t mention how much investors might receive in profits.

Officials have been told that the federal fund should shoulder some risk to help local funds, which would directly finance projects. Ottawa could take losses from any failed endeavours to help smaller funds attract private money by “virtually eliminating their exposure to risk.”

Other details of the government’s plan are yet to be released, including whether there will be knowledge hubs designed to help small groups learn and expand.

Sen. Ratna Omidvar, who has been a proponent of social finance in the upper chamber, said she expects these to be part of the plan.

“The field needs to be fertilized in a way so that the crops can grow,” she said.

“You can’t just simply push the money out the door without making sure that there is a higher bar on capacity, on understanding, how to service investments, how to capture data and evidence.”

She said the government needs to show patience, because success won’t be immediate. Omidvar also cautioned against fixating on financial returns to the federal fund as the measure of success.

“This is not for the short-term,” she said, pointing to experience in other countries.

“You have to have patience, you have to have determination. You have to obviously satisfy the political masters with interim indicators of success, but this is really a project for the longer term.”

Jordan Press, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

House arrest for Vernon physiotherapist guilty of sexual assault

Stephen Witvoet to serve 18-month conditional sentencing following July 8 hearing

Kelowna woman fights off nighttime intruder

Kelowna RCMP are investigating a break-and-enter on Richter Street

Morning Start: Naps could save your life

Your morning start for Wednesday, July 9, 2020

Building to begin on Okanagan Rail Trail washroom

Project starts Monday, July 13, in Coldstream between Westkal Road and Kickwillie Loop

Ex-Vernon Mountie forfeits 20 days’ pay after sexual misconduct review

A former Vernon RCMP constable made sexual comments, grabbed genitals of male officer in two incidents 10 years ago

Canadian policing organization calls for decriminalization of simple illicit drug possession

Canadian Association of Chiefs of Police want policing focus of opioid crisis to be replaced with a health one

Summerland Museum reopens

Museum to open on July 15 with reduced operating hours

Hefty undeclared driver charges piling up, ICBC warns customers

Average extra penalty $2,971 after an at-fault accident

Kootnekoff: B.C. Supreme Court rules clause in Uber’s contract is invalid

Susan Kootnekoff is the founder of Inspire Law, her diverse legal career spans over 20 years.

Survey, hotline launched amid probe into racist blood-alcohol guessing game at B.C. hospital

Mary Ellen Turpel-Lafond has been appointed to lead an investigation by Health Minister Adrian Dix

Pure magic: live performances revived in Revelstoke

Revelstoke Arts Council hosting Guerrilla Gigs on Wednesdays all summer long

Penticton photographer publishes book showcasing resilience of Okanagan people

Okanagan Strong showcases the bravery of many during crisis; from COVID-19, to floods, and fires

Summerland steam train to begin operations

Reduced schedule, physical distancing planned for Kettle Valley Steam Railway beginning July 18

B.C. appeals judge’s decision to leave three clubhouses in Hells Angels hands

The province has filed two notices of appeal related to the B.C. Supreme Court decision

Most Read